The Consequence of Not

In business, and increasingly in philanthropy and other areas, we want to know the return on investment (ROI) when we consider a new technology, a new practice, or even a new policy. And, in some cases, this is an easy measure and a direct correlation. A new piece of equipment purchased saves X amount of time, increasing productivity and/or decreasing costs by Y dollars.

Wise leaders understand, however, that returns aren’t always that direct. Investing in products or services that enhance a company’s culture or improve its communication requires a broader understanding of “return” and typically requires a different time horizon and calculus for measurement.

Employee retention, talent recruitment, employee affinity and resulting productivity, trust in your company, quick access to organizational knowledge, less time wasted managing emails resulting in lower employee stress, organizational goodwill: these returns are often difficult to put a dollar value on, or to correlate to a singular investment or action by the company. Yet, their benefits impact nearly every interaction within our company every day, and ultimately find their way to the bottom line. They build the workplace, not just the work.

Good leaders know these kinds of returns are critical to company success. And, focusing on them may just require a different question: what is the consequence of NOT investing?

What are the hidden costs when we fail to invest in culture? What are the efficiencies we will never know if we choose not to invest in better communication? What are the wasteful work-arounds we cannot even see but that are already in place as a result of our failure to invest?

Explicit returns on investment in culture and communication are often nebulous, and the fact that they cannot be clearly defined too often means we don’t invest in them. It’s a self-reinforcing loop that cuts at the heart of our companies and challenges our leadership, our productivity, and impacts our bottom line.

While writing this blog, I came across an article in the New York Times that included the following quote:

“(In our research) We often ask senior leaders a simple question: If your employees feel more energized, valued, focused and purposeful, do they perform better? Not surprisingly, the answer is almost always “Yes.” Next we ask, “So how much do you invest in meeting those needs?” An uncomfortable silence typically ensues.”

The article goes in depth in exploring this contradiction of acknowledged value and persistent lack of investment. Although long, it’s definitely worth a read.

At the most basic level, however, I think we need to start by changing the question, or at least asking another question. Instead of only asking about the ROI, we also need to ask about the consequence of not investing (CNI).


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